In the E-Cigarette FMCG Industry, Store Location Determines Everything

For many practitioners or store owners in the e-cigarette industry, location is everything; this is an unchanging rule, and it can even be said that this applies to all fast-moving consumer goods (FMCG) industries. After you have determined your choice of industry brand, a good location is the first key to success.

For most FMCG industries, from a profit perspective, the product's pure profit margin may range from 20% to 50%. After deducting labor, losses, and store opening costs, even if the gross profit of the product reaches 50%, this profit cannot be considered exorbitant; it can only be regarded as a high-profit industry. However, this high-profit industry must be viewed from the perspective of having a certain sales volume.

The gross profit margin of milk tea products far exceeds 50%, yet a significant number of milk tea shops still face losses and closures. The e-cigarette industry may fare slightly better because it is still in a rapid development phase, and competition among similar products is not yet fierce, but this trend is only a matter of time. Given the current development speed of the e-cigarette industry, it will soon enter a mid-stage phase.

In the face of increasing competition from similar stores or stores of the same brand, how to maintain your profits and customers is crucial. When there are e-cigarette stores on every street in the future, customers will inevitably choose to purchase nearby, especially between stores of the same brand. A good location and a good business district will naturally attract good foot traffic, leading to good sales. Currently, many e-cigarette specialty stores may not be in the best locations, but it is hard to predict what the impact will be in the face of future challenges.

The simplest example is that the owner of the first e-cigarette specialty store in a county-level city considers market and cost issues and chooses a relatively remote location to open the store. However, after working hard for a few months, someone else opens a store of the same brand in the largest and most prosperous commercial center in the area, and the market cultivated over several months ultimately benefits others, which is very regrettable.

For e-cigarette specialty stores, I have always believed that either you don't do it, or if you do, you should do it right from the start. Even if the costs may be higher, you must choose a good business district and a good location to face the increasingly fierce market competition.